Enphase Power has booked about 50 megawatt-hours of gross sales of its long-promised Encharge battery in North American markets since launching it in July, tapping a rising demand for power storage from residential photo voltaic clients, and laying the groundwork for a extra full dwelling backup energy system set to reach early subsequent yr. 

Gross sales of the battery system made up about 10 p.c of the microinverter maker’s $178.5 million in third quarter revenues, CEO Badri Kothandaraman mentioned in Tuesday’s third quarter earnings convention name. Whereas he did not disclose what number of batteries have been shipped so far, the microinverter maker can have the manufacturing capability for 50 megawatt-hours of Encharge techniques within the fourth quarter of 2020, and “we’re principally booked to it” by way of orders, he mentioned. 

It’s a notable debut for a product seen as a crucial step in Enphase’s plans to increase its attain past its core microinverter product and into broader dwelling power administration. Batteries are more and more being added to residential photo voltaic techniques in key U.S. markets, with opponents like Tesla, LG Chem, Sunrun and Generac battling for market share with a mixture of value factors, ease of set up, and residential power administration options. 

Enphase is a relative latecomer to this competitors in North America, having delayed the launch of Encharge from an preliminary late 2019 goal date. The brand new batteries differ from these it has been promoting to clients in Australia, New Zealand and sure European markets, in that they’re a part of an built-in system, combining batteries, inverter, associated switchgear and controls, and connectivity to the corporate’s Enlighten cloud-based photo voltaic monitoring platform. 

Encharge techniques come in three.36 kilowatt-hour items or in a three-unit, 10 kWh configuration, and so they use lithium-ion batteries from China-based producer A123. Enphase just lately added China’s CATL as a second battery producer, and is in discussions with a 3rd unnamed provider, Kothandaraman mentioned. By mid-2021, it expects to have 480 MWh per yr of manufacturing capability obtainable, he mentioned. 

The crucial California photo voltaic market

Past storing and shifting photo voltaic output to optimize its worth towards time-of-use web metering charges or meet export-limited regimes in numerous states, batteries are in demand for California clients looking for backup energy to journey via fire-prevention blackouts over the previous two years.

That’s put an emphasis on solar-storage techniques with power controls that may direct battery energy to totally different family masses, to keep away from the necessity for both hard-wiring crucial circuits or operating the danger of getting their whole-home masses deplete batteries prematurely throughout outages that may final from hours to days at a time. 

“Proper now our product doesn’t have that function,” requiring clients to manually choose and select which family masses they carry on throughout outages, Kothandaraman mentioned. Enphase hopes its IQ8 microinverter, which he referred to as its “first grid-independent microinverter,” will assist resolve that drawback when it’s made obtainable later subsequent yr. 

IQ8 will combine the corporate’s Ensemble dwelling power management software program to supply an“extensible structure, able to load management” by way of sensible switches for sure circuits or home equipment, or including turbines or gasoline cells, and ultimately electrical automobile chargers, he mentioned. The corporate can be planning to launch an IQ8D twin inverter for three-phase energy industrial purposes. 

Enphase has been working via the greater than 2,000 photo voltaic installers in its community to deploy its Encharge system so far, however can be in discussions with unnamed “Tier 1 and Tier 2” photo voltaic installers within the product, Kothandaraman mentioned. The corporate can be engaged on “a number of alternatives” to place its batteries to make use of for grid providers, as firms like Sunrun and Tesla are doing, though he declined to supply extra particulars on how or when that will occur. 

Third-quarter revenues for the Fremont, Calif.-based firm have been up 45 p.c from the earlier quarter however down barely from the identical quarter final yr. Third quarter earnings of $41.eight million beat the second quarter’s $23.5 million, which noticed impacts from the COVID-19 pandemic, and in addition exceeded third quarter 2019 earnings of $39.5 million, measured on a non-GAAP foundation. 

Gross sales of Enphase’s core microinverter merchandise additionally continued to develop in North America, Europe, Australia and Latin American markets, and non-GAAP gross margins, which measure revenues minus value of gross sales, rose to a document 41 p.c within the third quarter, up from 39.6 p.c within the second quarter and from 36.2 p.c within the third quarter of 2019. The corporate projected fourth-quarter revenues in a spread of $245 million to $260 million and non-GAAP gross margins within the vary of 38 to 41 p.c. 

Enphase has been locked in battle for market share within the residential photo voltaic inverter house with Israel-based SolarEdge, which held about 60 p.c of the market as of the primary 9 months of 2019, in comparison with about 20 p.c for Enphase, in accordance with Wooden Mackenzie’s U.S. PV Leaderboard.

“We’re persevering with to take share, I imagine, in microinverters,” Kothandaraman mentioned, although he declined to supply particular figures on its aggressive stance with SolarEdge, which is scheduled to report its third quarter outcomes subsequent week. 

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